[Chapter XVIII]
Ricardo’s Miscellanea.
John Barton

Net income, as opposed to
gross income (which is equal to the total product or the
value of the total product), is the form in which the
Physiocrats originally conceived surplus-value. They
consider rent to be its sole form, since they think of
industrial profit as merely a kind of wage; later economists
who blur the concept of profit by calling it wages for the
superintendence of labour, ought to agree with them.

Net revenue is therefore in fact the excess of the
product (or the excess of its value) over that part of it
which replaces the capital outlay, comprising both constant
and variable capital. It thus consists simply of profit
and rent, the latter, in turn, is only a separate portion of
the profit, a portion accruing to a class other than the
capitalist class.

The direct purpose of capitalist production is not the
production of commodities, but of surplus-value or profit
(in its developed form), the aim is not the product, but the
surplus-product. Labour itself, from this standpoint, is
only productive in so far as it creates profit or
surplus-product for capital. If the worker does not
create profit, his labour is unproductive. The mass of
productive labour employed is only of interest to capital in
so far as through it—or in proportion to it—the
mass of surplus-labour grows. Only to this extent is
what we called necessary labour-time, necessary. In so
far as it does not have this result, it is superfluous and
to be supressed.

It is the constant aim of capitalist production to
produce a maximum of surplus-value or surplus-product with
the minimum capital outlay; and to
the extent that this result is not achieved by overworking
the workers, it is a tendency of capital to seek to produce
a given product with the least possible
expenditure—economy of power and expense. It is
therefore the economic tendency of capital which teaches
humanity to husband its strength and to achieve its
productive aim with the least possible expenditure of
means.

In this conception, the workers themselves appear as that
which they are in capitalist production—mere means of
production, not an end in themselves and not the aim of
production.

Net income is not determined by the value of the total
product, but by the excess of the value of the total product
over the value of the capital outlay, or by the size of the
surplus-product in relation to the total product.
Provided this surplus grows the aim of capitalist production has been
achieved even if the value decreases ||733| or, if
along with the value, the total quantity of the product also
decreases.

Ricardo expressed these tendencies consistently and
ruthlessly.
Hence much howling against him on the part of
the philanthropic philistines.

In considering net income, Ricardo again commits the
error of resolving the total product into revenue, wages,
profits and rent, and disregarding the constant capital
which has to be replaced.
But we will leave this out of
account here.

Chapter XXXII “Mr. Malthus’s Opinions on
Rent”.

“It is of importance to distinguish clearly between
gross revenue and net revenue, for it is from the net
revenue of a society that all taxes must be paid.
Suppose
that all the commodities in the country, all the corn, raw
produce, manufactured goods, etc, which could be brought to
market in the course of the year, were of the value of 20
millions, and that in order to obtain this value, the labour
of a certain number of men was necessary, and that the
absolute necessaries of these labourers required an
expenditure of 10 millions.
I should say that the gross
revenue of such society was 20 millions, and its net revenue
10 millions.
It does not follow from this supposition, that
the labourers should receive only 10 millions for their
labour; they might receive 12, 14, or 15 millions, and in
that case they would have 2, 4, or 5 millions of the net
income.
The rest would be divided between landlords and
capitalists; but the whole net income would not exceed 10
millions.
Suppose such a society paid 2 millions in taxes,
its net income would be reduced to 8 millions” (l.c.,
pp. 512–13.)

[And in Chapter XXVI Ricardo says :]

“What would be the advantage
resulting to a country from […] a great quantity of
productive labour, if, whether it employed that quantity or
a smaller, its net rent and profits together would be the
same. The whole produce of
the land and labour of every country is divided into three
portions: of these, one portion is devoted to wages, another
to profits, and the other to rent.”

〈This is wrong because the portion devoted to
replacing the capital (wages excluded) employed in
production has been forgotten.〉

“It is from the two last portions only, that any
deductions can be made for taxes, or for saving; the
former, if moderate, constituting always the necessary
expenses of production” [l.c., p. 416].

〈Ricardo himself makes the following comment on this
passage in a note on page 416:

“Perhaps this is expressed too strongly, as more is
generally allotted to the labourer under the name of wages,
than the absolutely necessary expenses of production.
In
that case a part of the net produce of the country is
received by the labourer, and may be saved or expended by
him; or it may enable him to contribute to the defence of
the country” [l.c., p. 416].&rang

“To an individual with a capital of £ 20,000,
whose profits were £ 2,000 per annum, it would be a
matter quite indifferent whether his capital would employ a
hundred or a thousand men, whether the commodity produced,
sold for £10,000, or for £ 20,000, provided, in all
cases, his profits were not diminished below £
2,000.
Is not the real interest of the nation similar?
Provided its net real income, its rent and profits be the
same, it is of no importance whether the nation consists of
ten or of twelve millions of inhabitants.
Its power of
supporting fleets and armies, and all species of
unproductive labour, must be in proportion to its net, and
not in proportion to its gross income.
If five millions of
men could produce as much food and clothing as was necessary
for ten millions, food and c1othing for five millions would
be the net revenue.
Would it be of any advantage to the
country, that to produce this same net revenue, seven
millions of men should be required, that is to say, that
seven millions should be employed to produce food and
clothing sufficient for twelve millions?
The food and
clothing of five millions would be still the net
revenue.
The employing a greater number of men would enable
us neither to add a man to our army and navy, nor to
contribute one guinea more in taxes” (l.c.,
pp. 416–17).

To gain a better understanding of Ricardo’s views, the
following passages must also be considered.

“There is this advantage always resulting from a
relatively low price of corn,—that the division of the
actual production is more likely to increase the fund for
the maintenance of labour, inasmuch as more will be
allotted, under the name of profit, to the productive class,
a[a] less under the name rent, to the
unproductive class” (l.c., p. 317).

Productive class here refers only to the
industrial capitalists.

“Rent is a creation of value …
but not a creation of wealth. If the price of corn,
from the difficulty of producing any portion of it,
should rise from £4 to £5 per
quarter, a million of quarters will be of the value of £
5,000,000 instead of £ 4,000,000, … the society
altogether will be possessed of greater value, and in that
sense rent is a creation of value. But this value is
so far nominal, that it adds nothing to the wealth, that is
to say, the necessaries, conveniences, and enjoyments of the
society. We should have precisely the same quantity,
and no more of commodities, and the same million quarters of
corn as before; but the effect of its being rated at £ 5
per quarter, instead of £ 4, would be to transfer a
portion of the value of the corn and commodities from
their former possessors to the landlords. Rent
then is a creation of value, but not a creation of wealth;
it adds nothing to the resources of a country”
(l.c., pp. 485–86).

||734| Supposing that through the import of foreign corn
the price of corn falls so that rent is decreased by 1
million.
Ricardo says that as a result the money incomes of
the capitalists will increase, and then continues:

“But it may be said, that the capitalist’s income
will not he increased; that the million deducted from the
landlord’s rent, will he paid in additional wages to
labourers!
Be it so; … the situation of the
society will be improved, and they can [b] bear the same money
burthens with greater facility than before; it will only
prove what is still more desirable, that the situation of
another class, and by far the most important class in
society, is the one which is chiefly benefited by the
new distribution.
All that they receive more than 9
millions, forms part of the net income of the
country, and it cannot be expended without adding to its
revenue, its happiness, or its power.
Distribute then the
net income as you please.
Give a little more to one class,
and a little less to another, yet you do not thereby
diminish it; a greater amount of commodities will be still
produced with the same labour, although the amount of the
gross money value of such commodities will be diminished;
but the net money income of the country, that fund from
which taxes are paid and enjoyments procured, would be much
more adequate, than before, to maintain the actual
population, to afford it enjoyments and luxuries, and to
support any given amount of taxation” (l.c.,
pp. 515–16).

[B.] Machinery [Ricardo and Barton on the Influence of
Machines on the Conditions of the Working Class]

[a) Ricardo’s Original Surmise Regarding the
Displacement of Sections of the Workers by Machines]

Chapter I (Section V) “On Value”.

“Suppose … a machine which
could in any particular trade be employed to do the work of
one hundred men for a year, and that it would last only for
one year. Suppose too, the machine to cost £ 5,000,
and the wages annually paid to one
hundred men to be £ 5,000, it is evident that it would be
a matter of indifference to the manufacturer whether he
bought the machine or employed the men. But suppose
labour to rise, and consequently the wages of one hundred
men for a year to amount to £ 5,500, it is obvious that
the manufacturer would now no longer hesitate, it would be
for his interest to buy the machine and get his work done
for £ 5,000. But will not the machine rise in price,
will not that also be worth £ 5,500 in consequence of the
rise of labour? It would rise in price if there were
no stock employed on its construction, and no profits to be
paid to the maker of it. If for example, the machine
were the produce of the labour of one hundred men, working
one year upon it with wages of £ 50 each, and its price
were consequently £5,000; should those wages rise to £
55, its price would be £ 5,500, but this cannot be the
case; less than one hundred men are employed or it could not
be sold for £5,000, for out of the £ 5,000 must be
paid the profits of stock which employed the men.
Suppose then that only eighty-five men were employed at an
expense of £ 50 each, or £ 4,250 per annum, and that
the £ 750 which the sale of the machine would produce
over and above the wages advanced to the men, constituted
the profits of the engineer’s stock. When wages rose 10
per cent he would be obliged to employ an additional
capital of £ 425 and would therefore employ £
4,675 instead of £ 4,250, on which capital be would only
get a profit of £ 325 if he continued to sell his machine
for £ 5,000; but this is precisely the case of all
manufacturers and capitalists; the rise of wages affects
them all. If therefore the maker of the machine should
raise the price of it in consequence of a rise of wages, an
unusual quantity of capital would be employed in the
construction of such machines, till their price afforded
only the common rate of profits. We see then that
machines would not rise in price, in consequence of a rise
of wages.

“The manufacturer, however, who in a general rise
of wages, can have recourse to a machine which shall not
increase the charge of production on his commodity, would
enjoy peculiar advantages if he could continue to charge the
same price for his goods; but he, as we have already seen,
would be obliged to lower the price of his commodities, or
capital would flow to his trade till his profits had sunk to
the general level.
Thus then is the public benefited by
machinery: these mute agents are always the produce of much
less labour than that which they displace, even when they
are of the same money value” (l.c.,
pp. 38–40).

This point is quite right.
At the same time it provides
the answer to those who believe that the workers displaced
by machines find employment in machine manufacture
itself.
This view, incidentally, belongs to an epoch in
which the engineering workshop was still based entirely on
the division of labour, and machines were not as yet
employed on the production of machines.

Suppose the annual wage of one man to be £50, then
that of 100 is £5,000. If these 100 men are replaced
by a machine which costs, similarly, £5,000, then this
machine must be the product of the labour of less than 100
men. For besides paid labour it contains unpaid labour
which forms the profit of the machine
manufacturer. If it were the product of 100 men, then it
would contain only paid labour. If the rate of profit
were 10 per cent then approximately £4,545 of the
£5,000 would represent the capital advanced and
approximately £ 455 the profit. At [a wage of] £
50, £ 4,545 would only represent 90 9/10 men.

||735| But the capital of £4,545 by no means
represents only variable capital (capital laid out directly
in wages).
It represents also raw materials and the wear
and tear of the fixed capital employed by the machine
manufacturer.
The machine costing £5,000, which replaces
100 men whose wages come to £5,000, thus represents the
product of far fewer than 90 men.
Moreover, the machine can
only be employed profitably, if it 〈at least that portion
of it which enters annually with interest into the product,
i.e., into its value&rang is the (annual) product of far
fewer men than it replaces.

Every rise in wages increases the variable capital that
has to be laid out, although the value of the
product—since this is equal to the variable
capital plus the surplus-labour—remains the same, for
the number of workers which the variable capital sets in
motion remains the same.

[b) Ricardo on the Influence of Improvements in
Production on the Value of Commodities.
False Theory of the
Availability of the Wages Fund for the Workers Who Have Been
Dismissed]

Natural agents add nothing to the value of
commodities, on the contrary, [they reduce it].
But by doing so they add to the surplus-value, which
alone interests the capitalists.

“In contradiction to the opinion of Adam Smith,
M. Say, in the fourth chapter, speaks of the value which is
given to commodities by natural agents, such as the
sun, the air, the pressure of the atmosphere, etc., which
are sometimes substituted for the labour of man, and
sometimes concur with him in producing.
But these natural
agents, though they add greatly to value in use,
never add exchangeable value, of which M. Say is speaking,
to a commodity: as soon as by the aid of
machinery, or by the knowledge of natural philosophy,
you oblige natural agents to do the work which was before
done by man, the exchangeable value of such work falls
accordingly” (l.c., pp. 335–36).

The machine costs [labour].
Natural agents as such cost nothing. They cannot,
therefore, add any value to the product; rather they
diminish its value in so far as they replace capital or
labour, immediate or accumulated labour. In as much as
natural philosophy teaches how to replace human labour by
natural agents, without the aid of machinery or only with
the same machinery as before (perhaps even more cheaply, as
with the steam boiler, many chemical processes etc.), it
costs the capitalist, and society as well, nothing and
cheapens commodities absolutely.

Ricardo continues the above-quoted passage thus:

“If ten men turned a corn mill, and it be
discovered that by the assistance of wind, or of water, the
labour of these ten men may be spared, the flour which is
the produce partly of the work performed by the mill, would
immediately fall in value, in proportion to the quantity of
labour saved; and the society would be richer by the
commodities which the labour of the ten men could produce,
the funds destined for their maintenance being in no degree
impaired” (l.c., p. 336).

Society would in the first place be richer by the
diminished price of flour.
It would either consume more
flour or spend the money formerly destined for flour
upon some other commodity, either existing, or called into
life, because a new fund for consumption had become
available.

Of this part of the revenue, formerly spent on flour and
now, consequent upon the diminished price of flour, set free
for some other application, it may be said that it was
“destined”—by virtue of the whole
economy of the society—for a certain thing, and that
it is now freed from that “destiny”.
It is the same as if new capital had been accumulated.
And in this way, the application of machinery and natural agents frees
capital and enables previously “latent needs” to
be satisfied.

On the other hand, it is wrong to speak of “the
funds destined for the maintenance” of the ten
men thrown out of employment by the new discovery. For
the first fund which is saved or created through the
discovery is that part of the revenue which society
previously paid for flour and which it now saves as a result
of the diminished price of flour. The second fund which
is saved, however, is that which the miller previously paid
for the ten men now displaced. This “fund”
indeed, as Ricardo notes, is in no degree impaired by the
discovery and the displacement of the ten men. But the
fund has no natural connection with the ten men. They
may become paupers, starve etc.
One thing only is certain, that ten men of the new
generation who should take the place of these ten men in
order to turn the mill, must now be absorbed in other
employment; and so the relative population has increased
(independently of the average increase of population) in
that the mill is now driven [by a natural agent] and the ten
men who would otherwise have had to turn it are employed in
producing some other commodity. The invention of
machinery and the employment of natural agents thus set free
capital and men (workers) and create together with freed
capital freed hands (free hands, as Steuart calls them),
whether ||736| [for] newly
created spheres of production or [for] the old ones which
are expanded and operated on a larger scale.

The miller with his freed capital will build new mills or
will lend out his capital if he cannot use it himself as a
capitalist.

On no account, however, is there a fund
“destined” for the ten men displaced.
We
shall return to this absurd assumption: namely that, if the
introduction of machines (or natural agents) does not (as is
partly the case in agriculture, when horses take the place
of men or stock-raising takes the place of corn growing)
reduce the quantity of means of subsistence which can be
laid out in wages, the fund which has thus been set free
must necessarily be laid out as variable capital (as if
there was no possibility of exporting means of subsistence,
or spending them on unproductive workers, or [as if] wages
in certain spheres could not rise etc.) and must even be
paid out to the displaced labourers.
Machinery always
creates a relative surplus population, a reserve army of
workers, which greatly increases the power of capital.

In the note on page 335, Ricardo also makes the following
observation directed against Say:

“Though Adam Smith, who defined riches to consist
in the abundance of necessaries, convenience and enjoyments
of human life, would have allowed that machines and
natural agents might very greatly add to the riches of a
country, he would not have allowed that they add any
thing to the value of those riches” [l.c.,
p. 335, note].

Natural agents, indeed, add nothing to value, so
long as there are no circumstances in which they give
occasion for the creation of rent. But machines
invariably add their own value to the already
existing value and firstly, in so far as their existence
facilitates the further transformation of circulating into
fixed capital, and makes it possible to carry on this
transformation on an ever growing
scale, they increase not only wealth but also the
value which is added by past labour to the product of
the annual labour; secondly, since machines make possible
the absolute growth of population and with it the growth of
the mass of the annual labour, they increase the value of
the annual product in this second way. |736||

[c) Ricardo’s Scientific Honesty,
Which Led Him to Revise His Views on the Question of
Machinery. Certain False Assumptions Are Retained in
Ricardo’s New Formulation of the Question]

||736|Chapter XXXI “On Machinery”.

This section, which Ricardo added to his third edition,
bears witness to his honesty which so essentially
distinguishes him from the vulgar economists.

“It is more incumbent on me to declare my opinions
on this question” 〈viz. “the influence of
machinery on the interests of the different classes of
society”&rang, “because they have, on further
reflection, undergone a considerable change; and although I
am not aware that I have ever published any thing respecting
machinery which it is necessary for me to retract, yet I
have in other ways” 〈as a Member of Parliament&rang
“given my support to doctrines which I now think
erroneous; it, therefore, becomes a duty in me to submit my
present views to examination, with my reasons for
entertaining them” (l.c., p. 466).

“Ever since I first turned my attention to
questions of political economy, I have been of opinion, that
such an application of machinery to any branch of
production, as should have the effect of saving labour, was
a general good, accompanied only with that portion of
inconvenience which in most cases attends the removal of
capital and labour from one employment to
another.”

〈This inconvenience is great enough for the worker,
if, as in modern production, it is perpetual.&rang

“It appeared to me, that provided the
landlords had the same money rents, they would he benefited
by the reduction in the prices of some of the commodities on
which those rents were expended, and which reduction of
price could not fail to be the consequence of the employment
of machinery. The capitalist, I thought, was eventually
benefited precisely in the same manner. He, indeed, who
made the discovery of the machine, or who first usefully
applied it, would enjoy an additional advantage, by making
great profits for a time; but, in proportion as the machine
came into general use, the price of the commodity produced,
would, from the effects of competition, sink to its cost of
production, when the capitalist would get the same money
profits as before, and he would only participate in the
general advantage, ||737| as a
consumer, by being enabled, with the same money revenue, to
command an additional quantity of comforts and
enjoyments. The class of labourers also, I
thought, was equally benefited by the use of
machinery, as they would have the means of buying more
commodities with the same money wages, and I thought that no
reduction of wages would take place, because the capitalist would have the power of demanding
and employing the same quantity of labour as before,
although he might be under the necessity of employing it in
the production of a new, or at any rate of a different
commodity. If, by improved machinery, with the
employment of the same quantity of labour, the quantity of
stockings could be quadrupled, and the demand for stockings
were only doubled, some labourers would necessarily be
discharged from the stocking trade; but as the
capital which employed them was still in
being, and as it was the interest of those who had it
to employ it productively, it appeared to me that it
would be employed on the production of some other commodity,
useful to the society, for which there could not fail to be
a demand… As, then, it appeared to me that
there would be the same demand for labour as before,
and that wages would be no lower, I thought that the
labouring class would, equally with the other classes,
participate in the advantage, from the general cheapness of
commodities arising from the use of machinery.

“These were my opinions, and they continue
unaltered, as far as regards the landlord and the
capitalist; but I am convinced, that the substitution of
machinery for human labour, is often very injurious to
… the class of labourers” (l.c.,
pp. 466–68).

In the first place, Ricardo starts from the false
assumption that machinery is always introduced into spheres
of production in which the capitalist mode of production
already exists.
But the mechanised loom originally replaced
the hand-loom weaver, the spinning jenny the hand spinner,
the mowing, threshing and sowing machines often the small
peasant who himself cultivated his plot of land, etc.
In
this case, not only is the labourer displaced, but his
instrument of production too ceases to be capital (in the
Ricardian sense).
This entire or complete devaluation of the
old capital also takes place when machinery revolutionises
manufacture previously based on the simple division of
labour.
It is ridiculous to say in this case that the
“old capital” continues to make the same demand
for labour as before.

The “capital” which was employed by the
hand-loom weaver, hand spinner etc. has ceased to exist.

But suppose, for the sake of simplicity, that the
machinery is introduced 〈there is, of course, no question
here of the employment of machinery in new branches
of industry&rang only into spheres where capitalist
production (manufacture) is already [dominant] or it may be
introduced into the workshop already based on machinery,
thus increasing the mechanisation of the labour processes or
bringing into use improved machinery, which makes it
possible either to dismiss a section of the workers
previously employed or to produce a greater product while
employing the same number of workers as before.
The
latter is of course the most favourable case.

In order to reduce confusion, we
must distinguish here between 1. the funds of the capitalist
who employs machinery and dismisses workers; 2. the funds of
society, that is, of the consumers of the commodities
produced by this capitalist.

ad 1. So far as the capitalist who introduces the
machinery is concerned, it is wrong and absurd to say that
he can lay out the same amount of capital in wages as
before.
(Even if he borrows, it is still equally wrong, not
for him, but for society.) One part of his capital he will
convert into machinery and other forms of fixed capital,
another part into auxiliary materials which he did not need
before, and a larger part into raw materials, if we assume
that he produces more commodities with fewer workers, thus
requiring more raw material.
The proportion of variable
capital—that is to say, of capital laid out in
wages—to constant capital has decreased in his branch
of business.
And this reduction in the proportion will
be permanent (indeed, the decrease in variable capital
relatively to constant will even continue at a faster
rate as a result of the productive power of labour
developing along with accumulation), even if his business on
the new scale of production expands to such an extent that
he can re-employ the total number of dismissed workers, and
employ even more workers than before.
〈The demand for
labour in his business will grow with the accumulation of
his capital, but to a much smaller degree than his capital
accumulates, and his capital will in absolute terms never
again require the same amount of labour as before.
The
immediate result, however, will be that a section of the
workers is thrown on to the street.&rang

But it may be said that indirectly the demand for workers
will remain the same, for more workers will be required for
the construction of machines. But Ricardo himself has
already shown that machinery never costs as much labour as
the labour which it displaces. It is possible for the
hours of labour in the machine workshops to be lengthened
for some time ||738| and that,
in the first instance, not a man more may be employed in
them. Raw material—cotton for example—can
come from America and China and it makes no difference
whatsoever to the Englishmen who have been thrown out of
work, whether the demand for Negroes or coolies grows.
But even assuming that the raw materials are supplied within
the country, more women and children will be employed in
agriculture, more horses etc., and perhaps more of one
product and less of another will be
produced. But there will be no demand for the dismissed
workers, for in agriculture, too, the same process which
creates a constant relative surplus population is taking
place.

Prima facie it is not likely that the introduction
of machinery will set free any of the capital of the
manufacturer when he makes his first investment.
It merely
provides a new type of investment for his capital, its
immediate result, according to the assumption, is the
dismissal of workers and the conversion of part of the
variable capital into constant capital.

ad 2.
So far as the general public is concerned,
in the first place, revenue is set free as a result
of the lowering in price of the commodity produced by means
of the machine; capital—directly—only in
so far as the manufactured article enters into constant
capital as an element of production.
〈If it entered into
the average consumption of the worker, it would, according
to Ricardo, bring in its wake a reduction in real
wages also in the other branches of industry.&rang A part of
the revenue thus set free, will be consumed in the same
article, either because the reduction in price makes it
accessible to new classes of consumers (in this case,
incidentally, it is not displaced revenue that is expended
on the article), or because the old consumers consume more
of the cheaper article, for instance four pairs of cotton
stockings instead of one pair.
Another part of the revenue
thus set free may serve to expand the industry into which
the machinery has been introduced, or it may be used in the
formation of a new industry producing a different commodity,
or it may serve to expand a sphere of production which
already existed before.
For whatever purpose the revenue
thus set free and reconverted into capital is used, it will
in the first place hardly be sufficient to absorb that part
of the increased population which each year streams into
each branch of production, and which is now debarred from
entering the old industry.
It is, however, also possible for
a portion of the freed revenue to be exchanged against
foreign products or to be consumed by unproductive
workers.
But by no means does a necessary
connection exist between the revenue that has been set free
and the workers that have been set free of revenue.

The absurd fundamental notion, however, which underlies
Ricardo’s view, is the following:

The capital of the manufacturer who introduces machinery
is not set free. It is merely utilised in a
different manner, namely, in such a manner that it is
not, as before, transformed into
wages for the workers who are discharged. A part of the
variable capital is converted into constant capital.
Even if some of it were set free, it would be absorbed by
spheres in which the discharged labourers could not
work and where, at the most, those who replace them
could find refuge.

By expanding old spheres of production or opening up new
ones the revenue set free—in so far as it is not
offset by greater consumption of the cheaper article or is
not exchanged against foreign means of
subsistence—only gives the necessary opening (if it
does so!) for that part of the annual population increase
that is for the time being debarred from the old trade into
which the machinery has been introduced.

But the absurdity which lies concealed at the root of
Ricardo’s notions, is this:

The means of subsistence which were previously consumed
by the workers now discharged, remain after all in existence
and are still on the market.
The workers, on the other hand,
are also available on the market.
Thus there are, on the one
hand, means of subsistence (and therefore means of payment)
for workers, i.e., potential variable capital, and on the
other, unemployed workers.
Hence the fund is there to set
them in motion.
Consequently they will find employment.

Is it possible that even such an economist as Ricardo can
babble such hair-raising nonsense?

According to this, no human being who is capable of work
and willing, could ever starve in bourgeois society, when
there are means of subsistence on the market, at the
disposal of the society, to pay him for any work whatever.
These means of subsistence, in the first place, do not by
any means confront those workers as capital.

Assume that 100,000 workers have suddenly been thrown out
on the streets by machinery. Then in the first place
there is no doubt whatsoever ||739| that the agricultural products
on the market, which on the average suffice for the whole
year and which were previously consumed by these workers,
are still on the market as before. If there were no
demand for them—and if, at the same time, they were
not exportable— what would happen? As the supply
relative to the demand would have grown, they would fall in
price, and as a result of this fall in price, their
consumption would rise, even if the 100,000 workers were
starving to death. The price need not even fall. Perhaps less of these means of
subsistence is imported or more of them exported.

Ricardo imagines quixotically that the entire bourgeois
social mechanism is arranged so nicely that if, for
instance, ten men are discharged from their work, the means
of subsistence of these workers—now set
free—must definitely be consumed in one way or another
by the identical ten men and that otherwise they could not
be sold; as if a mass of semi-employed or completely
unemployed were not for ever crawling around at the bottom
of this society—and as if the capital existing in the
form of means of subsistence were a fixed amount.

If the market-price of corn fell due to the decreasing
demand, then the capital available in the shape of corn
would be diminished (in terms of money) and would
exchange for a smaller portion of the society’s money
revenue, in so far as it is not exportable.
And this applies
even more to manufactures.
During the many years in which
the hand-loom weavers were slowly dying of hunger, the
production and export of English cotton cloth increased
enormously.
At the same time (1838–1841) the prices of
provisions rose.
And the weavers had only rags in which to
clothe themselves and not enough food to keep body and soul
together.
The constant artificial production of a surplus
population, which disappears only in times of feverish
prosperity, is one of the necessary conditions of production
of modern industry.
There is nothing to prevent a part of
the money capital lying idle and without employment and the
prices of the means of subsistence falling because of
relative surplus production while at the same time workers
who have been displaced by machinery, are starving.

It is true that in the long run the labour that has been
released together with the portion of revenue or capital
that has been released, will find an opening in a new sphere
of production or in the expansion of the old one, but this
is of more benefit to those who succeed the displaced
men than to the displaced men themselves.
New
ramifications of more or less unproductive branches of
labour are continually being formed and in these revenue is
directly expended.
Then there is the formation of fixed
capital (railways etc.) and the labour connected with
superintendence which this opens up; the manufacture of
luxuries etc., foreign trade, which increasingly diversifies
the articles on which revenue is spent.

From his absurd standpoint, Ricardo therefore assumes
that the introduction of machinery
harms the workers only when it diminishes the gross product
(and therefore gross revenue), a case which may occur, it is
true, in large-scale agriculture, with the introduction of
horses which consume corn in place of the workers, with the
transition from corn-growing to sheep-raising etc.; but it
is quite preposterous [to extend this case] to industry
proper, whose ability to sell its gross product is by no
means restricted by the internal market. (Incidentally,
while one section of the workers starves, another section
may be better fed and clothed, as may also the unproductive
workers and the middle strata between worker and
capitalist.)

It is wrong, in itself, to say that the increase (or the
quantity) of articles entering into revenue as such, forms a
fund for the workers or forms capital for them.
A portion of
these articles is consumed by unproductive workers or
non-workers, another portion may be transformed by means of
foreign trade, from its coarse form, the form in which it
serves as wages, into a form in which it enters into the
revenue of the wealthy, or in which it serves as an element
of production of constant capital.
Finally, a portion will
be consumed by the discharged workers themselves in the
workhouse, or in prison, or as alms, or as stolen goods, or
as payment for the prostitution of their daughters.

In the following pages I shall briefly compare the
passages in which Ricardo develops this nonsense.
As he says
himself, he received the impetus for it from Barton’s
work, which must therefore be examined, after citing those
passages.

||740| It is self-evident, that in order to employ a
certain number of workers each year, a certain quantity of
food and other necessary means of subsistence must be
produced annually.
In large-scale agriculture, stock-raising
etc, it is possible for the net income (profit and rent) to
be increased while the gross income is reduced, that is to
say, while the quantity of necessaries intended for the
maintenance of the workers is reduced.
But that is not the
question here.
The quantity of articles entering into
consumption or, to use Ricardo’s expression, the quantity of
articles of which the gross revenue consists, can be
increased, without a consequent increase in that portion of
this quantity which is transformed into variable
capital.
This may even decrease.
In this case more is
consumed as revenue by capitalists, landlords and their
retainers, the unproductive classes, the state, the middle
strata (merchants) etc.

What lies behind the view taken by
Ricardo (and Barton) is that he originally set out from the
assumption that every accumulation of capital is equivalent
to an increase in variable capital, that the demand for
labour therefore increases directly, in the same proportion,
as capital is accumulated. But this is wrong, since with
the accumulation of capital a change takes place in its
organic composition and the constant part of the capital
grows at a faster rate than the variable. This does not,
however, prevent revenue from constantly growing, in value
and in quantity. But it does not result in a
proportionately larger part of the total product being laid
out in wages. Those classes and sub-classes who do not
live directly from their labour become more numerous and
live better than before, and the number of unproductive
workers increases as well.

Since, in the first place, it has nothing to do with the
question, we will not concern ourselves with the
revenue of the capitalist who transforms a part of
his variable capital into machinery (and who therefore also
puts more into raw material relatively to the amount of
labour employed in all those spheres of production where raw
material is an element of the process of creating
value). His revenue and that part of his capital which
has actually gone into the production process exist, at
first, in the form of products or rather
commodities which he produces himself, for example
yarn if he is a spinner. After the introduction of
machinery he transforms one part of these
commodities—or the money for which he sells
them—into machinery, auxiliary materials and raw
materials whereas, previously, he paid it out as wages to
the workers, thus transforming it indirectly into means of
subsistence for the workers. With some exceptions in
agriculture, he will produce more of these commodities than
before, although his discharged workers have ceased
to consume, and therefore to buy his own articles, though
they did so before. More of these commodities will now
be present on the market, although for the workers thrown on
the street, they have ceased to exist [as objects of
consumption] or have ceased to exist in their previous
quantity. Thus, so far as his own product is concerned,
in the first place, even if it enters into the consumption
of the workers, its increased production in no way
contradicts the fact that a part of it has ceased to exist
as capital for the workers. A larger part of it (of the
total product) on the other hand must now replace that
portion of the constant capital which resolves into
machinery, auxiliary materials and
raw materials, that is to say, it must be exchanged against
more of these ingredients of reproduction than formerly.
If the increase in commodities through machinery and the
decrease in a previously existing demand (namely in the
demand of the workers that have been discharged) for the
commodities produced by this machinery were contradictory,
then in most cases, no machinery could in fact be
introduced. The mass of commodities produced and the
portion of these commodities which is reconverted into
wages, therefore, have no definite relationship or necessary
connection, when we consider the capital of which a part is
transformed into machinery instead of into wage labour.

So far as society in general is concerned, the
replacement of its revenue or rather the extension of the
limits of its revenue takes place first of all on account of
the articles whose price has been lowered by the
introduction of machinery. This revenue may continue
to be spent as revenue, and if a considerable part of it is
transformed into capital, the increased
population—apart from the artificially created surplus
population—is already there to absorb that part of the
revenue which is transformed into variable capital.

Prima facie, therefore, what this comes to is
only: the production of all other articles, particularly in
the spheres which produce articles entering into the
consumption of the workers—despite the discharging of
the hundred men etc.—continues on the same scale as
before; quite certainly at the moment when the workers are
discharged. In so far, therefore, as the dismissed
workers represented a demand for these articles, the demand
has decreased, although the supply has remained the
same. If the reduced demand is not made good, the price
will fall (or instead of a fall in price a larger stock may
remain on the market for the following year). If the
article is not produced for export, too, and if the decrease
in demand were to persist, then reproduction would decrease,
but it does not follow that the capital employed in this
sphere ||741| must necessarily
decrease. Perhaps more meat or commercial crops or
luxury foods are produced [and] less wheat or more oats for
horses etc. or fewer fustian jackets and more bourgeois
frock-coats. But none of these consequences need
necessarily materialise, if, for instance, as a result of
the cheapening of cotton goods, the employed workers are
able to spend more on food etc. The same quantity of
commodities and even more of them—including those consumed by the workers—can be
produced, although less capital, a smaller portion of the
total product, is transformed into variable capital, that is
laid out in wages.

Neither is it the case that part of the capital of the
producers of these articles has been set free.
At worst the
demand for their commodities would have decreased, and the
reproduction of their capital impeded by the reduced price
of their commodities.
Hence their own revenue would
immediately decrease, as it would with any fall in the
prices of commodities.
But it cannot be said that any
particular part of their commodities had previously
confronted the discharged workers as capital and was now
“set free” along with the workers.
What
confronted the workers as capital, was a part of the
commodity now being produced with machinery; this part came
to them in the form of money and was exchanged by them for
other commodities (means of subsistence), which did not face
them as capital, but confronted their money as
commodities.
This is therefore an entirely different
relationship.
The farmer and any other producer whose
commodity they bought with their wages, did not confront
them as capitalist and did not employ them as workers.

They have only ceased to be buyers for him, which
may possibly—if not counterbalanced by other
circumstances—bring about a temporary depreciation in
his capital, but does not set free any capital for the
discharged workers.
The capital that employed them “is
still in being”, but no longer in a form in which it
resolves into wages, or only indirectly and to a smaller
extent.

Otherwise anyone who through some bad luck ceased to have
money, would inevitably set free sufficient capital for his
own employment.

[d) Ricardo’s Correct Determination of Some of the
Consequences of the Introduction of Machines for the Working
Class.
Apologetic Notions in the Ricardian Explanation of
the Problem]

By gross revenue Ricardo means that part of the
product which replaces wages and surplus-value (profits and
rent); by net revenue he means the surplus-product, [which]
equals the surplus-value. He forgets here, as throughout
his work, that a portion of the gross
product must replace the value of the machinery and raw
material, in short, the value of the constant capital.

* * *

Ricardo’s subsequent treatment is of interest, partly
because of some of the observations he makes in passing,
partly because, mutatis mutandis, it is of practical
importance for large-scale agriculture, particularly
sheep-rearing, and shows the limitations of capitalist
production.
Not only is its determining purpose not
production for the producers (workmen), but its exclusive
aim is net revenue (profit and rent), even if this is
achieved at the cost of the volume of production—at
the cost of the volume of commodities produced.

“My mistake arose from the supposition, that
whenever the net income of a society increased, its
gross income would also increase; I now, however, see
reason to be satisfied that the one fund, from which
landlords and capitalists derive their revenue, may
increase, while the other, that upon which the
labouring class mainly depend, may diminish, and
therefore it follows, if I am right, that the same
cause which may increase the net revenue of the country,
may at the same time render the population redundant,
and deteriorate the condition of the labourer” (l.c.,
p. 469).

First it is noteworthy that Ricardo here admits that
causes which further the wealth of the capitalists and
landlords “may…render the population
redundant…” so that redundant population or
over-population is presented here as the result of the
process of enrichment itself, and of the development of
productive forces which conditions this process.

So far as the fund is concerned, out of which the
capitalists and landlords draw their revenue and on the
other hand the fund from which the workers draw theirs, to
begin with, it is the total product which forms this common
fund. A large part of the products which enter into the
consumption of the capitalists and landlords, does not enter
into the consumption of the workers. On the other hand,
almost all, in fact more or less all, products which enter
into the consumption of the workers also enter into that of
the landlords and capitalists, their retainers and
hangers-on, including dogs and cats. One cannot suppose
that there are two essentially distinct fixed funds in
existence. The important point is, what relative portion
each of these groups draws from the common fund. The aim
of capitalist production is to obtain as large an amount of
surplus-product or surplus-value as
possible with a given amount of wealth. This aim is
achieved by constant capital growing more rapidly in
proportion to variable capital or by setting in motion the
greatest possible ||742|
constant capital with the least possible variable
capital. In much more general terms than Ricardo
conceives here, the same cause effects an increase in the
fund out of which capitalists and landlords draw their
revenue, by a decrease in the fund out of which the workers
draw theirs.

It does not follow from this that the fund from which the
workers draw their revenue is diminished absolutely;
only that it is diminished relatively, in proportion
to their total output.
And that is the only important factor
in the determination of the portion which they appropriate
out of the wealth they themselves created.

“A capitalist we will suppose employs a capital of
the value of £ 20,000 and that he carries on the joint
business of a farmer, and a manufacturer of necessaries.
We
will further suppose, that £ 7,000 of this capital is
invested in fixed capital, viz. in buildings, implements,
etc., etc., and that the remaining £ 13,000 is employed
as circulating capital in the support of labour.
Let us
suppose, too, that profits are 10 per cent, and consequently
that the capitalist’s capital is every year put into its
original state of efficiency, and yields a profit of £
2,000.

“Each year the capitalist begins his operations, by
having food and necessaries in his possession of the value
of £ 13,000, all of which he sells in the course of the
year to his own workmen for that sum of money, and, during
the same period, he pays them the like amount of money for
wages: at the end of the year they replace in his
possession food and necessaries of the value of £ 15,000,
£ 2,000 of which he consumes himself, or disposes of as
may best suit his pleasure and gratification.”

〈The nature of surplus-value is very palpably
expressed here.
The passage is on pp. 469–70.&rang

“As far as these products are concerned, the
gross produce for that year is £ 15,000, and the
net produce £ 2,000.
Suppose now, that the following year
the capitalist employs half his men in constructing a
machine, and the other half in producing food and
necessaries as usual.
During that year he would pay the sum
of £ 13,000 in wages as usual, and would sell food and
necessaries to the same amount to his workmen; but what
would be the case the following year?

“While the machine was being made,
only one-half of the usual quantity of food and necessaries
would be obtained, and they would be only one-half the value
of the quantity which was produced before. The machine
would be worth £ 7,500, and the food and necessaries £
7,500, and, therefore, the capital of the capitalist would
be as great as before for he would have besides these two
values, his fixed capital worth £ 7,000, making in the
whole £ 20,000 capital, and £ 2,000 profit. After
deducting this latter sum for his own expenses, he would
have a no greater circulating capital than £ 5,500 with
which to carry on his subsequent
operations; and, therefore, his means of employing labour,
would be reduced in the proportion of £ 13,000 to £
5,500, and, consequently, all the labour which was before
employed by £ 7,500, would become redundant”
[l.c., pp. 469–71].

{This would, however, also be the case if by means of the
machine which costs £7,500, exactly the same quantity of
products were produced as previously with a variable capital
of £13,000. Suppose the wear and tear of the machine
were equal to one-tenth in one year, that is to £750,
then the value of the product—previously
£15,000—would now be £8,250. (Apart from the
wear and tear of the original fixed capital of £7,000,
whose replacement Ricardo does not mention at all.) Of these
£8,250, £2,000 would be profit, as previously out of
the £15,000. The lower price would be advantageous to
the farmer in so far as he himself consumes food and
necessaries as revenue. It would also be advantageous to
him in so far as it enables him to reduce the wages of the
workers he employs thus releasing a portion of his variable
capital. It is this portion, which to a certain degree
could employ new labour, but only because the real
wage of the workers who have been retained had
fallen. A small number of those who have been discharged
could thus—at the cost of those who had been
retained—be re-employed. The fact however that the
product would be just as great as before, would not help the
dismissed workers. If the wage remained the same, no
part of the variable capital would be released. The fact
that the product of £8,250 represents the same amount of
necessaries and food as previously £15,000 does not cause
its value to rise. The farmer would have to sell it for
£8,250, partly in order to replace the wear and tear of
his machinery and partly in order to replace his variable
capital. In so far as this lowering of the price of food
and necessaries did not bring about a fall in wages in
general, or a fall in the ingredients entering into the
reproduction of the constant capital, the revenue of society
would have expanded only in so far as it is expended on food
and necessaries. A section of the unproductive and
productive workers etc. would live better. That is
all. (They could also save, but that is always action in
the future). The discharged workers would remain on the
street, although the physical possibility of their
maintenance existed just as much as before. Moreover,
the same capital would be employed in the reproduction
process as before. But a part
of the product (whose value had fallen), which
previously existed as capital has now become
revenue.}

“The reduced quantity of labour which the
capitalist can employ, must, indeed, with the
assistance of the machine, and after deductions for its
repairs, produce a value equal to £ 7,500, it must
replace the circulating capital with a profit of £ 2,000
on the whole capital; but if this be done, ||743| if the net
income be not diminished, of what importance is it to the
capitalist, whether the gross income be of the value of £
3,000, of £ 10,000, or of £ 15,000?”

〈This is perfectly correct.
The gross income is of
absolutely no importance to the capitalist.
The only thing
which is of interest to him is the net income.&rang

“In this case, then, although the net
produce will not be diminished in value, although its power
of purchasing commodities may be greatly increased, the
gross produce will have fallen from a value of £ 15,000
to a value of £ 7,500, and as the power of supporting
a population, and employing labour, depends always on the
gross produce of a nation, and not on its net
produce” [l.c., p. 471]

〈Hence Adam Smith’s partiality for gross produce, a
partiality to which Ricardo objects.
See Chapter XXVI “On Gross and Net Revenue”, which Ricardo
opens with the words:

“Adam Smith constantly magnifies the advantages
which a country derives from a large gross, rather than a
large net income” (l.c., p. 415)&rang

“…there will necessarily be a diminution
in the demand for labour, population will become
redundant, and the situation of the labouring classes
will be that of distress and poverty” [l.c.,
p. 471].

〈Labour therefore becomes redundant, because
the demand for labour diminishes, and that demand diminishes
in consequence of the development in the productive powers
of labour.&rang

“As, however, the power of saving from revenue
to add to capital, must depend on the efficiency of the net
revenue, to satisfy the wants of the capitalist, it
could not fail to follow from the reduction in the price
of commodities consequent on the introduction of
machinery, that with the same wants” (but
his wants grow larger) “he would have increased
means of saving,—increased facility of transferring
revenue into capital” (l.c., pp. 471–72).

〈According to this, first one part of capital is
transformed into revenue, transferred to revenue—not
in terms of value, but as regards the use-value, the
material elements of which the capital consists—in
order later, to transfer a part of the revenue back into
capital. For example, when £13,000 was laid out in
variable capital a part of the product amounting to £7,500, entered into the consumption of the
workers whom the farmer employed, and this part of the
product formed part of his capital. Following upon the
introduction of machinery, for example, according to our
supposition, the same amount of product is produced as
previously, but its value does not amount to £15,000, as
previously, but only to £8,250; and a larger part of this
cheaper product enters into the revenue of the farmer or the
revenue of the buyers of food and necessaries. They now
consume a part of the product as revenue which was
previously consumed industrially, as capital, by the farmer,
although his labourers (since dismissed) consumed it as
revenue as well. As a result of this growth in
revenue—which has come about because a part of the
product which was previously consumed as capital is now
consumed as revenue—new capital is formed and revenue
is reconverted into capital.&rang

“But with every increase of capital he would employ
more labourers;”

〈this in any case not in proportion to the
increased capital, not to the whole extent of that
increase.
Perhaps he would buy more horses, or guano, or new
implements&rang

“and, therefore, a portion of the people thrown
out of work in the first instance, would be subsequently
employed; and if the increased production, in consequence of
the employment of the machine, was so great as to afford, in
the shape of net produce, as great a quantity of food and
necessaries as existed before in the form of gross
produce, there would be the same ability to employ
the whole population, and, therefore, there would not
necessarily” 〈but possibly and probably!&rang
“be any redundancy of people” (l.c.,
pp. 469–72).

In the last lines, Ricardo thus says what I observed
above.
In order that revenue is transformed in this way into
capital, capital is first transformed into revenue.
Or, as
Ricardo puts it: First the net produce is increased at the
expense of the gross produce in order then to reconvert a
part of the net produce into gross produce.
Produce is
produce.
Net or gross makes no difference (although this
antithesis may also mean that the excess over and above
the outlay increases, that therefore the net produce
grows although the total product, i.e., the gross produce,
diminishes).
The produce only becomes net or gross,
according to the determinate form which it assumes in the
process of production.

“All I wish to prove, is, that the
discovery and use of machinery may be attended with a
diminution of gross produce; and whenever that is the case,
it will be injurious to the labouring class, as some of
their number will be thrown out of
employment, and population will become redundant,
compared with the funds which are to employ it”
(l.c., p. 472).

But the same may, and in most instances ||744| will, be
the case, even if the gross produce remains the same or
increases; but that part of it which was formerly used as
variable capital, is now consumed as revenue.

It is superfluous for us to go into Ricardo’s absurd
example of the clothier who reduces his production because
of the introduction of machinery (pp. 472–74).

“If these views be correct, it follows,

“1st. That the
discovery, and useful application of machinery, always
leads to the increase of the net produce of
the country, although it may not, and will not, after an
inconsiderable interval, increase the value of that
net produce” (l.c., p. 474).

It will always increase that value whenever it diminishes
the value of labour.

“2dly.
That an increase of the net produce
of a country is compatible with a diminution of the gross
produce, and that the motives for employing machinery are
always sufficient to insure its employment, if it will
increase the net produce, although it may, and frequently
must, diminish both the quantity of the gross produce, and
its value.

“3dly, That the opinion entertained by the
labouring class, that the employment of machinery is
frequently detrimental to their interests, is not founded on
prejudice and error, but is conformable to the correct
principles of political economy.

“4thly.
That if the improved means of
production, in consequence of the use of machinery, should
increase the net produce of a country in a degree so great
as not to diminish the gross produce, (I mean always
quantity of commodities and not value,) then the situation
of all classes will be improved.
The landlord and capitalist
will benefit, not by an increase of rent and profit, but by
the advantages resulting from the expenditure of the same
rent, and profit, on commodities, very considerably reduced
in value”

〈this sentence contradicts the whole of Ricardo’s
doctrine, according to which the lowering in the price of
necessaries, and therefore of wages, raises profits, whereas
machinery, which permits more to be extracted from the same
land with less labour, must lower rent&rang,

“while the situation of the labouring classes will
also be considerably improved; 1st, from the increased
demand for menial servants;”

〈this is indeed a fine result of machinery, that a
considerable section of the female and male labouring class
is turned into servants;&rang

“2dly, from the stimulus to savings
from revenue, which such an abundant net produce will
afford; and 3dly, from the low price of all articles of consumption on which their wages will be
expended” 〈and in consequence of this low price
their wages will be reduced&rang (l.c.,
pp. 474–75).

The entire apologetic bourgeois presentation of machinery
does not deny,

1.
That machinery—sometimes here, sometimes there,
but continually—makes a part of the population
redundant, throws a section of the labouring population on
the street.
It creates a surplus population, thus leading to
lower wages in certain spheres of production, here or there,
not because the population grows more rapidly than the means
of subsistence, but because the rapid growth in the means of
subsistence, due to machinery, enables more machinery to be
introduced and therefore reduces the immediate
demand for labour.
This comes about not because the
social fund diminishes, but because of the growth of this
fund, the part of it which is spent in wages falls
relatively.

2.
Even less do these apologetics deny the subjugation of
the workers who operate the machines and the wretchedness of
the manual workers or craftsmen who are displaced by
machinery and perish.

What they assert—and partly rightly—is
[firstly] that due to machinery and the development
of the productivity of labour in general the net revenue
(profit and rent) grows to such an extent, that the
bourgeois needs more menial servants than before;
whereas previously he had to lay out more of his product in
productive labour, he can now lay out more in unproductive
labour, [so that] servants and other workers living on the
unproductive class increase in number.
This progressive
transformation of a section of the workers into servants is
a fine prospect.
For the worker it is equally consoling that
because of the growth in the net product, more spheres are
opened up for unproductive workers, who live on his product
and whose interest in his exploitation coincides more or
less with that of the directly exploiting classes.

Secondly, that because of the spur given to
accumulation, on the new basis requiring less living labour
in proportion to past labour, the workers who were dismissed
and pauperised, or at least that part of the population
increase ||745| which replaces
them, are either absorbed in the expanding engineering-works
themselves, or in branches of production which machinery has
made necessary and brought into being, or in new fields of
employment opened by the new capital, and satisfying new
wants. This then is another
wonderful prospect: the labouring class has to bear all the
“temporary inconveniences”—unemployment,
displacement of labour and capital—but wage-labour
is nevertheless not to be abolished, on the contrary it will
be reproduced on an ever growing scale, growing absolutely,
even though decreasing relatively to the growing total
capital which employs it.

Thirdly: that consumption becomes more
refined due to machinery.
The reduced price of the
immediate necessities of life allows the scope of luxury
production to be extended.
Thus the third fine prospect
opens before the workers : in order to win their means of
subsistence, the same amount of them as before, the same
number of labourers will enable the higher classes to
extend, refine, and diversify the circle of their
enjoyments, and thus to widen the economic, social, and
political gulf separating them from their betters.
Fine
prospects, these, for the labourer, and very desirable
results of the development of the productive powers of his
labour.

Furthermore, Ricardo then shows that it [is in] the
interest of the labouring classes,

“that as much of the revenue as possible should be
diverted from expenditure on luxuries, to be expended in the
support of[d] menial
servants” (l.c., p. 476).
For whether I [purchase]
furniture or keep menial servants, I thereby present a
demand for a definite amount of commodities and set in
motion approximately the same amount of productive labour in
one case as in the other; but in the latter case, I add [a
new demand] “to the former demand for labourers, and
this addition would take place only because I chose this
mode of expending my revenue’ (l.c., p. 476).

The same applies to the maintenance of large fleets and
armies.

“Whether it” (the revenue) “was
expended in the one way or in the other, there would be
the same quantity of labour employed in production;
for the food and clothing of the soldier and sailor would
require the same amount of industry to produce it as the
more luxurious commodities; but in the case of the war,
there would be the additional demand for men as soldiers and
sailors; and, consequently, a war which is supported out of
the revenue, and not from the capital of a country, is
favourable to the increase of population” (l.c.,
p. 477).

“There is one other case that should
be noticed of the possibility of an increase in the
amount of the net revenue of a country, and even of
its gross revenue, with a diminution of demand for
labour, and that is, when the labour of horses is
substituted for that of man. If I employed one hundred
men on my farm, and if I found that the food bestowed on
fifty of those men, could be diverted
to the support of horses, and afford me a greater return of
raw produce, after allowing for the interest of the capital
which the purchase of the horses would absorb, it would be
advantageous to me to substitute the horses for the men, and
I should accordingly do so; but this would not be for the
interest of the men, and unless the income I obtained, was
so much increased as to enable me to employ the men as well
as the horses, it is evident that the population would
become redundant, and the labourer’s condition would
sink in the general scale. It is evident he could not,
under any circumstances, he employed in agriculture;”
(why not? if the field of agriculture were enlarged?)
“but if the produce of the land were increased by the
substitution of horses for men, be might be employed in
manufactures, or as a menial servant” (l.c.,
pp. 477–78).

There are two tendencies which constantly cut across one
another; [firstly,] to employ as little labour as possible,
in order to produce the same or a greater quantity of
commodities, in order to produce the same or a greater net
produce, surplus-value, net revenue; secondly, to employ the
largest possible number of workers (although as few as
possible in proportion to the quantity of commodities
produced by them) , because— at a given level of
productivity—the mass of surplus-value and of
surplus-product grows with the amount of labour
employed.
The one tendency throws the labourers on to the
streets and makes a part of the population redundant, the
other absorbs them again and extends wage-slavery
absolutely, so that the lot of the worker is always
fluctuating but he never escapes from it.
The worker,
therefore, justifiably regards the development of the
productive power of his own labour as hostile to himself;
the capitalist, on the other hand, always treats him as an
element to be eliminated from production.
These are the
contradictions with which Ricardo struggles in this
chapter.
What he forgets to emphasise ||746| is the
constantly growing number of the middle classes, those who
stand between the workman on the one hand and the capitalist
and landlord on the other.
The middle classes maintain
themselves to an ever increasing extent directly out of
revenue, they are a burden weighing heavily on the working
base and increase the social security and power of the upper
ten thousand.

According to the bourgeoisie the perpetuation of
wage-slavery through the application of machinery is a
“vindication” of the latter.

“I have before observed, too, that
the increase of net incomes, estimated in commodities,
which is always the consequence of improved machinery,
will lead to new savings and accumulations. These
savings, it must be remembered, are annual, and
must soon create a fund, much greater than the gross revenue, originally lost by the
discovery of the machine, when the demand for labour
will be as great as before, and the situation of the people
will be still further improved by the increased savings
which the increased net revenue will still enable them to
make” (l.c., p. 480).

First gross revenue declines and net revenue
increases.
Then a portion of the increased net revenue is
transformed into capital again and hence into gross
revenue.
Thus the workman must constantly enlarge the power
of capital, and then, after very serious disturbances,
obtain permission to repeat the process on a larger
scale.

“With every increase of capital and population,
food will generally rise, on account of its being more
difficult to produce” (l.c., pp. 478–79).

It then goes straight on:

“The consequence of a rise of food will be a rise
of wages, and every rise of wages will have a tendency to
determine the saved capital in a greater proportion than
before to the employment of machinery.
Machinery and labour
are in constant competition, and the former can frequently
not be employed until labour*
rises” (l.c., p. 479).

The machine is thus a means to prevent a rise of
labour.

“To elucidate the principle, I have been supposing,
that improved machinery is suddenly discovered, and
extensively used; but the truth is, that these discoveries
are gradual, and rather operate in determining the
employment of the capital which is saved and accumulated,
than in diverting capital from its actual
employment” (l.c., p. 478).

The truth is, that it is not so much the displaced labour
as, rather, the new supply of labour—the part of the
growing population which was to replace it—for which,
as a result of new accumulation, new fields of employment
are opened.

“In America and many other countries, where the
food of man is easily provided, there is not nearly such
great temptation to employ machinery” 〈nowhere is
it used on such a massive scale and also, so to speak, for
domestic needs as in America&rang “as in England, where
food is high, and costs much labour for its
production” [l.c., p. 479].

{How little the employment of machinery is dependent on
the price of food is shown precisely by America, which
employs relatively much more machinery than England, where
there is always a redundant population. The use of
machinery may, however, depend on the relative
scarcity of labour as, for instance, in America, where a
comparatively small population is spread over immense tracts
of land. Thus we read in the
Standard of September 19, 1862, in an article on the
Exhibition:

“‘Man is a machine-making
animal’… if we consider the American as a
representative man, the definition is … perfect.
It is one of the cardinal points of an American’s system to
do nothing with his bands that he can do by a machine.
From rocking a cradle to making a coffin, from milking a cow
to clearing a forest, from sewing on a button to voting for
President, almost, he had a machine for everything. He
has invented a machine for saving the trouble of masticating
food… The exceeding scarcity of labour and
its consequent high value” 〈despite the low value
of food&rang, “as well as a certain innate
‘cuteness’ have stimulated this inventive
spirit… The machines produced in America are,
generally speaking, inferior in value to those made in
England … they are rather, as a whole, makeshifts
to save labour than inventions to accomplish former
impossibilities”, 〈And the steam ships?&rang
… [at the Exhibition] “in the United States
department […] is Emery’s cotton gin. For
many a year after the introduction of cotton to America the
crop was very small; because not only was the demand rather
limited, but the difficulty of cleaning the crop by manual
labour rendered it anything but remunerative. When Eli
Whitney, however, invented the saw cotton-gin ||747| there was an immediate
increase in the breadth planted, and that increase has
up to the present time gone on almost in an arithmetical[e] progression. In
fact, it is not too much to say that Whitney made the cotton
trade. With modifications more or less important and
useful his gin has remained in use ever since; and until the
invention of the present improvement and addition Whitney’s
original gin was quite as good as the most of its would-he
supplanters. By the present machine, which bears the
name of Messrs. Emery of […] Albany, N.Y., we
have no doubt that Whitney’s gin, on which it is based, will
be almost entirely supplanted. It is simple and more
efficacious; it delivers the cotton not only cleaner, but in
sheets like wadding, and thus the layers as they leave the
machine are at once fit for the cotton press and the bale
… In [the] American Court proper there is little else
than machinery […] The cow-milker … a
belt-shifter … a hemp carding and spinning
machine, which at one operation reels the cliver direct
from the bale … machines[f] […] for the manufacture of
paper-bags, which it cuts from the sheet, pastes, folds,
and perfects at the rate of 300 a minute …
Hawes’s clothes-wringer, which by two indiarubber rollers
presses from clothes the water, leaving them almost dry,
[…] saves time, but does not injure the texture
… bookbinder’s machinery … machines
for making shoes. It is well known that the uppers
have been for a long time made up by machinery in this
country, but here are machines for putting on the sole,
others for cutting the sole to shape, and others again for
trimming the heels… A stone-breaking
machine is very powerful and ingenious, and no doubt
will come extensively into use for ballasting roads and
crushing ores… A system of marine signals
by Mr. W. H. Ward of Auburn, New York… Reaping
and mowing machines are an American invention coming
into very general favour in England. […]
McCormick’s” [machine is] “the best …
Hansbrow’s California Prize Medal Force Pump, is in
simplicity and efficiency the best […] in the
Exhibition … it will throw
more water with the same power than any pump in the
world… Sewing machines…”}

“The same cause that raises labour, does not raise
the value of machines, and, therefore, with every
augmentation of capital, a greater proportion of it is
employed on machinery.
The demand for labour will continue
to increase with on increase of capital, but not in
proportion to its increase; the ratio will necessarily be a
diminishing ratio” ([David Ricardo, On the
Principles of Political Economy, and Taxation, third
edition, London, 1821,] p. 479).

In the last sentence Ricardo expresses the correct law of
growth of capital, although his reasoning is very
one-sided.
He adds a note to this, from which it is evident
that he follows Barton here, whose work we will
therefore examine briefly.

But first one more comment.
When Ricardo discussed
revenue expended either on menial servants or luxuries, he
wrote:

“In both cases the net revenue would
he the same, and so would be the gross revenue, but the
former would be realised in different
commodities” (l.c., p. 476).

Similarly the gross produce, in terms of value, may be
the same, but it may “be realised”—and
this would strongly affect the workmen—” in
different commodities” according to whether it had
to replace more variable or constant capital.

[a) Barton’s Thesis that Accumulation of Capital
Causes a Relative Decrease in the Demand for
Labour.
Barton’s and Ricardo’s Lack of Understanding of the
Inner Connection Between This Phenomenon and the Domination
of Capital over Labour]

Barton’s work is called:

John Barton.
Observations on the Circumstances which
Influence the Condition of the Labouring Classes of
Society, London, 1817.

Let us first gather together the small number of
theoretical propositions to be found in Barton’s work.

“The demand for labour depends on
the increasing of circulating, and not of fixed
capital. Were it true that the proportion between
these two sorts of capital is the same at all times, and in
all countries, then, indeed, it follows that the
number of labourers employed is in proportion to the
wealth of the State. But such a position has not the
semblance of probability. As arts are cultivated, and
civilization is extended, fixed capital bears a larger
and larger proportion to circulating capital. The
amount of fixed capital employed in
the production of a piece of British muslin is at least a
hundred, probably a thousand times greater than that
employed in the production of a similar piece of Indian
muslin. And the ||748|
proportion of circulating capital employed is a hundred or a
thousand times less. It is easy to conceive that, under
certain circumstances, the whole of the annual savings of an
industrious people might he added to fixed capital, in which
case they would have no effect in increasing the demand for
labour” (l.c., pp. 16–17).

〈Ricardo comments on this passage in a note on page
480 of his work:

“It is not easy, I think, to conceive that under
any circumstances, an increase of capital should not he
followed by an increased demand for labour; the most that
can he said is, that the demand will be in a diminishing
ratio.
Mr. Barton, in the above publication, has, I
think, taken a correct view of some of the effects of
an increasing amount of fixed capital on the condition of
the labouring classes.
His Essay contains much valuable
information.”&rang

To Barton’s above proposition we must add the following
one:

“Fixed capital […] when once formed,
ceases to affect the demand for labour,” (incorrect,
since it necessitates reproduction, even if only at
intervals and gradually) “but during its formation it
gives employment to just as many hands as an equal amount
would employ, either of circulating capital, or of
revenue” (l.c., p. 56).

Adam Smith believes that the demand for labour grows in
direct proportion to capital accumulation.
Malthus derives
surplus population from capital not being accumulated (that
is, reproduced on a growing scale) as rapidly as the
population.
Barton was the first to point out that the
different organic component parts of capital do not grow
evenly with accumulation and development of the productive
forces, that on the contrary in the process of this growth,
that part of capital which resolves into wages decreases in
proportion to that part (he calls it fixed capital) which in
relation to its size, alters the demand for labour only to a
very small degree.
He is therefore the first to put forward
the important proposition “that the number of
labourers employed is” not “in proportion
to the wealth of the state”, that relatively more
workers are employed in an industrially undeveloped country
than in one which is industrially developed.

In the third edition of his Principles, Chapter
XXXI “On Machinery”, Ricardo—having
followed exactly in Smith’s footsteps
in his earlier editions—now takes up Barton’s
correction on this point, and moreover, in the same
one-sided formulation in which Barton gives it.
The only point in which he makes an advance—and this
is important—is that, unlike Barton, he not only says
that the demand for labour does not grow
proportionally with the development of machinery, but
that the machines themselves “render the population
redundant” [l.c., p. 469], i.e., create surplus
population. But he wrongly limits this effect to the
case in which the net produce is increased at the cost of
the gross produce. This only occurs in agriculture, but
he also transfers it into industry. Essentially’
however, the whole of the absurd theory of population was
thus overthrown, in particular also the claptrap of the
vulgar economists, that the workers must strive to keep
their multiplication below the standard of the accumulation
of capital. The opposite follows from Barton’s and
Ricardo’s presentation, namely that to keep down the
labouring population, thus diminishing the supply of labour,
and, consequently, raising its price, would only
accelerate the application of machinery, the
conversion of circulating into fixed capital, and, hence,
make the population artificially “redundant”;
redundancy exists, generally, not in regard to the quantity
of the means of subsistence, but the means of employment,
the actual demand for labour.

||749| Barton’s error or
deficiency lies in his conceiving the organic
differentiation or composition of capital only in the form
in which it appears in the circulation
process—as fixed and circulating capital—a
difference which the Physiocrats had already discovered,
which Adam Smith had developed further and which became a
prepossession among the economists who succeeded him; a
prepossession in so far as they see only this
difference—which was handed ‘down to
them—in the organic composition of capital. This
difference, which arises out of the process of circulation,
has a considerable effect on the reproduction of wealth in
general, and therefore also on that part of it which forms
the wages fund. But that is not decisive here. The
difference between fixed capital such as machinery,
buildings, breeding cattle etc. and circulating capital,
does not directly lie in their relation to wages, but
in their mode of circulation and reproduction.

The direct relation of the different component
parts of capital to living labour is not connected with the
phenomena of the circulation
process. It does not arise from the latter, but from the
immediate process of production, and its [expression]
is the relation of constant to variable
capital, whose difference is based only on their
relationship to living labour.

Thus Barton says for example: The demand for labour does
not depend on fixed capital, but only on circulating
capital.
But a part of circulating capital, raw
material and auxiliary materials, is not
exchanged against living labour, any more than is
machinery.
In all branches of industry in which raw material
enters as an element into the process of the creation of
value— in so far as we consider only that portion of
the fixed capital which enters into the commodity—it
forms the most important part of that portion of
capital which is not laid out in wages.
Another part of the
circulating capital, namely of the commodity capital,
consists of articles of consumption which enter into the
revenue of the non-productive class (i.e., [not of] the
working class).
The growth of these two parts of
circulating capital therefore does not influence the
demand for labour any more than does that of fixed
capital.
Furthermore, the part of the circulating capital
which resolves into raw materials and auxiliary materials
increases in the same or even greater proportion as that
part of capital which is fixed in machinery etc.

On the basis of the distinction made by Barton,
Ramsay goes further.
He improves on Barton but
retains his method of approach.
Indeed he reduces the
distinction to constant and variable capital, but continues
to call constant capital fixed capital, although he
includes raw materials etc., and [calls] variable capital
circulating capital, although he excludes from it all
circulating capital which is not directly laid out in
wages.
More on this later, when we come to Ramsay.
It does,
however, show the intrinsic necessity of the progress.

Once the distinction between constant capital and
variable capital has been grasped, a distinction which
arises simply out of the immediate process of production,
out of the relationship of the different component parts of
capital to living labour, it also becomes evident that in
itself it has nothing to do with the absolute amount of the
consumption goods produced, although plenty with the way in
which these are realised. The way, however, of realising
the gross revenue in different commodities is not, as
Ricardo has it, and Barton intimates it, the cause,
but the effect of the immanent laws of capitalistic
production, leading to a diminishing
proportion, compared with the total amount of produce, of
that part of it which forms the fund for the reproduction of
the labouring class. If a large part of the capital
consists of machinery, raw materials, auxiliary materials
etc., then a smaller portion of the working class as a whole
will be employed in the reproduction of the means of
subsistence ||750| which enter
into the consumption of the workers. This relative
diminution in the reproduction of variable capital, however,
is not the reason for the relative decrease in the demand
for labour, but on the contrary, its effect. Similarly:
A larger section of the workers employed in the production
of articles of consumption which enter into revenue in
general, will produce articles of consumption that are
consumed by— are exchanged against the revenue
of—capitalists, landlords and their retainers (state,
church etc.), [and a smaller) section [will produce]
articles destined for the revenue of the workers. But
this again is effect, not cause. A change in the social
relation of workers and capitalists, a revolution in the
conditions governing capitalist production, would change
this at once. The revenue would be “realised in
different commodities”, to use an expression of
Ricardo’s.

There is nothing in the, so-to-speak, physical conditions
of production which forces the above to take place.
The workmen, if they were dominant, if they were allowed to
produce for themselves, would very soon, and without great
exertion, bring the capital (to use a phrase of the vulgar
economists) up to the standard of their needs. The
very great difference is whether the available means of
production confront the workers as capital and can therefore
be employed by them only in so far as it is necessary
for the increased production of surplus-value and
surplus-produce for their employers, in other words whether
the means of production employ the workers, or
whether the workers, as subjects, employ the means of
production—in the accusative case—in order to
produce wealth for themselves. It is of course assumed
here that capitalist production has already developed the
productive forces of labour in general to a sufficiently
high level for this revolution to take place.

〈Take for example 1862 (the present autumn). The
plight ‘of the Lancashire unemployed labourers; on the
other hand, “the difficulty of finding employment for
money” on the London money
market, this has almost made necessary the formation of
fraudulent companies, since it [is] difficult to obtain two
per cent for money. According to Ricardo’s theory
“some new field of employment ought to have been
opened up,” for on the one hand there is capital in
London, and on the other, unemployed workers in
Manchester.&rang

[b) Barton’s Views on the Movement of Wages and the
Growth of Population]

Barton explains further, that the accumulation of capital
increases the demand for labour only very slowly, unless the
population has grown to such an extent previously,
that the rate of wages is low.

“The proportion which the wages of
labour at any particular[g] time bear to the whole
produce of […] labour
[…] determine the appropriation” of
capital “in one way” (as fixed capital)
“or the other” (circulating capital) ([John
Barton, Observations on the Circumstances Which Influence
the Condition of the Labouring Class of Society, London,
1817], p. 17).

“For if […] the rate of wages
should decline, while the price of goods remained the same,
or if goods should rise, while wages remained the same, the
profit of the employer would increase, and he would be
induced to hire more hands. If on the other hand,
wages should rise in proportion to commodities” [the]
“master[h]’ […] would […] keep as few hands
as possible.— He would aim at performing every thing
by machinery” (l.c., pp. 17–18).

“We have good evidence that
population advanced much more slowly under a gradual rise of
wages during the earlier part of the last century, than
during the latter part of the same century while the real
price of labour fell rapidly” (l. c., p. 25).

“A rise of wages, of itself, then,
never increases the labouring population;—a fall of
wages may sometimes increase it very rapidly. Suppose
that” the Englishman’s demands should sink to the
level of the Irishman’s. Then the manufacturer would
engage more [workers][i] “in proportion to the
diminished expense of maintenance” (l.c., p. 26).

“It is the difficulty of finding
employment, much more than the insufficiency of the
rate of wages, which discourages marriage” (l.c.,
p. 27).

“It is admitted that every increase
of wealth has a tendency to create a fresh demand for
labour; but as labour, of all commodities, requires the
greatest length of time for its production”

〈for the same reason, the rate of wages can remain
below the average for long periods, because of all
commodities, labour is the most
difficult to withdraw from the market and thus to bring down
to the level of the actual demand&rang

“so, of all commodities ||751| it is the most raised
[…] by a given increase of demand; and as every rise
of wages produces a tenfold reduction of profits; it is
evident that the accumulation of capital can operate only
in an inconsiderable degree in adding to the effectual
demand for labour, unless preceded by such an
increase of population as shall have the effect of keeping
down the rate of wages” (l. c., p. 28).

Barton puts forward various propositions here:

First: It is not the rise of wages in itself which
increases the labouring population, but a fall in wages may
very easily and rapidly make it rise. Proof: First
half of the eighteenth century, gradual rise in wages, slow
movement in population; in the second half of the eighteenth
century, on the other hand, sharp fall in real wages, rapid
increase in the labouring population. Reason: It is
not the insufficient rate of wages which prevents marriages,
but the difficulty of finding employment.

Secondly: The facility of finding employment
stands, however, in inverse ratio to the rate of
wages. For capital is transformed into circulating or
fixed capital, that is to say, capital which employs labour
or capital which does not employ it, in inverse proportion
to the high or low level of wages. If wages are low,
then the demand for labour is great because it is then
profitable for the employer to use much labour, and he can
employ more with the same circulating capital.
If wages are high, then the manufacturer employs as few
workers as possible and seeks to do everything with the aid
of machines.

Thirdly: The accumulation of capital by itself
raises the demand for labour only slowly, because each
increase in this demand, if [labour is] scarce, causes [the
wages] of labour to rise rapidly and brings about a fall of
profit which is ten times greater than the rise in
wages. Accumulation can have a rapid effect on the
demand for labour only if accumulation was preceded by a
large increase in the labouring population, and wages
are therefore very low so that even a rise of wages still
leaves them low because the demand mainly absorbs unemployed
workers rather than competing for those fully employed.

This is all, cum grano salis, correct so far as
fully developed capitalist production is concerned. But it
does not explain this development itself.

And even Barton’s historical proof therefore contradicts
that which it is supposed to prove.

During the first half of the
eighteenth century, wages rose gradually, the population
grew slowly and [there was] no machinery; moreover, compared
with the following half of the century, little other fixed
capital [was employed].

During the second half of the eighteenth century,
however, wages fell continuously, population grew
amazingly—and [so did] machinery. But it was
precisely the machinery which on the one hand made the
existing population superfluous, thus reducing wages, and on
the other hand, as a result of the rapid development of the
world market, absorbed the population again, made it
redundant once more and then absorbed it again; while at the
same time, it speeded up the accumulation of capital to an
extraordinary extent, and increased the amount of
variable capital, although variable capital fell relatively,
both compared with the total value of the product and also
compared with the number of workers it employed. In
the first half of the eighteenth century, however,
large-scale industry did not as vet exist, but only
manufacture based on the division of labour.
The principal component part of capital was still variable
capital laid out in wages. The productivity of labour
developed slowly, compared with the second half of the
century. The demand for labour, and therefore also
wages, rose almost proportionately to the accumulation of
capital. England was as vet essentially an
agricultural nation and a very extensive cottage
industry—spinning and weaving—which was carried
on by the agricultural population, continued to exist, and
even to expand. A numerous proletariat could not as
yet come into being, any more than there could exist
industrial millionaires at the time. In the first half
of the eighteenth century, variable capital was relatively
dominant; in the second, fixed capital; but the latter
requires a large mass of human material. Its
introduction on a large scale must be preceded by an
increase of population. The whole course of things,
however, contradicts Barton’s presentation, in as much as it
is evident that a general change in the method of production
took place. The laws which correspond to large-scale
industry are not identical with those corresponding to
manufacture ||752|. The
latter constitutes merely a phase of development leading to
the former.

But in this context some of Barton’s historical
data—comparing the development in England during the
first half and the second half of the eighteenth
century—are of interest,
partly because they show the movement of wages, and
partly because they show the movement in corn prices.

“… wages […] increased
from the middle of the seventeenth, till near the middle of
the eighteenth century, for the price of corn declined
within that space of time not less than 35 per cent”
[l.c., p. 25]. “The following statement will
shew what proportion the wages of husbandry
[…] have borne[j] to the price of corn […]
during the last seventy years.

Periods

Weeklypay

Wheat perquarter

Wages in pintsof wheat

1742 to 1752

6s. 0d.

30s. 0d.

102

1761 to 1770

7s. 6d.

42s. 6d.

90

1780 to 1790

8s. 0d.

51s. 2d.

80

1795 to 1799

9s. 0d.

70s. 8d.

65

1800 to 1808

11s. 0d.

86s. 8d.

60

(l.c., pp. 25–26)

‘From a table of the number of Bills for the
inclosing of land passed in each session since the
revolution, given in the Lord’s Report on the Poor
Laws” (1816?), “it appears that in sixty-six
years from 1688 to 1754, that number was 123; in the
sixty-nine[k] years
from 1754 to 1813 it was 3,315.— The progress of
cultivation was then about twenty-five times more rapid
during the last period than the former. But during the
first sixty-six years more and more corn was grown
continually for exportation; whereas, during the greater
part of the last sixty-nine years, we not only consumed all
that we had formerly sent abroad, but likewise imported an
increasing, and at last a very large quantity, for our own
consumption … the increase of population in the
former period, as compared with the latter, was still slower
than the progress of cultivation might appear to
indicate” (l. c., pp. 11–12).

“In the year 1688, the population of
England and Wales was computed by Gregory King, from the
number of houses, at five millions and a half.” The
population in “1780 is put down by Mr. Malthus at
7,700,000. In ninety-two years then it had increased
2,200,000—in the succeeding thirty years it increased
something more than 2,700,000. But of the first
increase […] there is every probability, that the far
greater part took place from 1750 to 1780” (l. c.,
p. 13).

Barton calculates from good sources that

“the number of inhabitants in
1750” [was] “5,946,000, making an increase since
the revolution of 446,000, or 7,200 per annum” (l.c.,
p. 14).

“At the lowest
estimate then […] the progress of population of late
years has been ten times more rapid than a century ago.
Yet it is impossible to believe, that the accumulation of
capital has been ten times greater” (l. c.,
p. 14).

It is not a question of how great a quantity of means of
subsistence is produced annually, but how large a portion of
living labour enters into the annual production of fixed and
circulating capital. This determines the size of the
variable capital in relation to constant.

Barton explains the remarkable increase in population
which took place almost all over Europe during the last 50
to 60 years, from the increased productivity of the American
mines, since this abundance of precious metals raised
commodity prices more than wages, thus in fact, lowering the
latter and causing the rate of profit to rise (l.c.,
pp. 29–35). |XIII-752||